Underlining the need for “mindset” change among policymakers, CEO of leading consultancy KPMG in India Richard Rekhy said a lot has happened on improving the ease of doing business in India but a lot more has to happen in this regard.
While a lot of changes have happened after the new Companies Act first came out and easier issues have been dealt with, he said its implementation “still continues to be a big challenge” which also goes against the ease of doing business.
“I think there has to be a mindset change among the policymakers. All rules and regulations should be formed based on the dealing that people do business in the right way,” Rekhy said.
Noting that rules are formed with the assumption that people are doing business in the wrong way, he said the concept should not be that the innocent has to prove himself innocent.
“Innocent does not need to prove himself innocent because it impedes the ease of doing business. This becomes a huge cost to compliance,” he noted.
In India, KPMG, which has a client base of more than 2,700 companies, is into diverse areas including financial and business advisory, tax and regulatory, and risk advisory services, as per its website.
On the ease of doing business, Rekhy said a lot has happened but a lot more has to happen.
“There are too many rules and regulations that are there… While it (ease of doing business) has improved, it has not improved to the extent that people want it to be improved. There are ground level changes to be done (for investors to come),” he said.
Noting that there are many more changes to be done, he said if the government does not want to rewrite the rules, then a committee should be formed along with the business community and then look at what the real life challenges are.
India is ranked at the 130th position in the World Bank’s Doing Business Report and the government is working on ways to further improve the overall ease of doing business.
About issues related to implementation of Companies Act, 2013, he expressed hope that those would be addressed once the amendments are in place.
After extensive stakeholder consultations, the Corporate Affairs Ministry has proposed further amendments to the Act — whose most provisions came into force from April 1, 2014. The amended law is expected to be passed by the Parliament during the Winter Session starting next month.